FATCA & Possible Criminal Charges

Chad Silver

Chad Silver

Managing Partner of Silver Tax Group, author of the book "Stop the IRS". Practicing a variety of tax issues, regulations, laws and rights. Specializing exclusively on tax matters involving IRS audits, negotiation, settlements & compromises.

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You may face criminal charges for violations of the Foreign Account Tax Compliance Act (FATCA). Such charges can include obstruction of the functions of the IRS.

As we’ve mentioned in past posts, FATCA concerns foreign financial institutions reporting on American accountholder information to treasury officials. The policy behind FATCA is to prevent such accountholders from hiding income.

What a FATCA Prosecution May Look Like

A group of U.S. taxpayers are facing conspiracy charges concerning securities fraud, money laundering, and a number of tax crimes. The conspiracy apparently fell apart after an undercover agent discovered what was going on. Those charged allegedly opened multiple foreign accounts without collecting required FATCA information.

A U.S. attorney released the following statement pertaining to the case: “The charges announced today reflect the commitment of this Office and our law enforcement partners to combat tax evasion by identifying fraudulent offshore safe havens.” This attorney also warns that they will continue to pursue violators.

FATCA has become a tool for worldwide reporting of offshore accounts. The government also has a large number of resources for combatting violations. FATCA requires reporting for Americans holding foreign accounts in excess of $50,000. And consequences for covering up violations may be severe – more severe than the actual violation.

What should Michigan taxpayers do?

For Michigan taxpayers with offshore accounts, it is important to not take chances.

Besides filing criminal charges, the IRS may seize 50 percent of an account and assess additional penalties.

It is therefore important to seek the advice of a seasoned tax attorney when reporting issues concerning FATCA arise.

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